Japan to propose $88B university fund for science and technology innovation

Last week, Japanese Prime Minister Fumio Kishida’s advisory panel called for an $88 billion university fund to establish the nation as a center of science and technology and distribute wealth to the wider public. The fund and other growth initiatives would likely become part of a larger “new capitalism” stimulus package worth several tens of trillions of yen that Kishida, who replaced Yoshihide Suga as prime minister of Japan on Oct. 4, is expected to unveil later this month.

The university fund is one pillar of Japan’s new growth strategy tasked with backing research and development on digital transformation and green innovations. The fund is expected to support the development of clean energy technologies such as storage batteries and electric vehicles. In addition, the panel suggested strong investments in advanced science related to AI, digital, and quantum technologies. However, the growth strategy does not mention the scale, details, or extra funding of the stimulus package. Kishida has also pledged to boost domestic output of semiconductors through the creation of a strong supply chain and construction of domestic chip factories.

To promote more equitable distribution of wealth, the strategy hopes to more directly shift wealth from companies to households by revamping Japan’s tax system and providing greater tax credits and other measures to companies in order to help raise employee wages.